Cancelled Events- A Problem?
With COVID-19 still striking in many parts of the world, there are a multitude of agreements, contracts, and events that could not reasonably take place. While some organizers or businesses are proactively refunding money or making alternate arrangements to satisfy clients. For others, it can be a little more difficult, especially if monies have already been spent by a business and can not easily be recovered.
Especially in the United States, anyone can issue a lawsuit for just about anything. Will it be successful, or even heard within a court depends on many factors, not the least of which is what part of the country you may live in. Written contracts such as for wedding can be especially tricky. Some organizers post in written communication or within contracts that no refunds will be given. Although this is a good start it is often not enough to avoid a lawsuit being filed when the party offering a service fails to provide that service.
Force Majeure is often employed written contracts, but may also apply in certain cases for events being cancelled, and may leave the client with a lost deposit. Force Majeure may be employed in a number of circumstances such as acts of God such as severe weather, epidemics, war, and some others that can not reasonably have been foreseen by the provider of the service. The pandemic certainly seems to meet these circumstances. But what if a client persists? Another element of Force Majeure is the act of governments making it illegal for people to congregate as well as orders to stay home. In addition, photography or related fields was certainly not determined to be a essential service. These factors suggest that the cause of the cancellation could not be overcome and therefore the provider can not be considered negligent or in breach of any agreement.
This MAY or MAY NOT apply depending upon the area of the country where the event was to be held. In that case, a Impracticability/Impossibility or Frustration of Purpose defense may still apply. The Governors of many states issued a lockdown forcing many non essential businesses to close. A Frustration of purpose makes the provider of the service worthless to a client , frustrating the purpose of the contract or agreement. A photographers services are worthless to a potential client if the government has shut the business down. Both parties would not benefit if the police would potentially halt or arrest anyone attempting to complete an activity.
Given our current circumstances, it would seem likely that if a lawsuit were filed, that the defendant would prevail using one or both of the defenses above. Economic hardship WOULD NOT enter into the situation above. Simply because it would be a economic hardship to provide a service would not be a viable defense and the such a defense would loose. In theory, if the virus only affected one or two states, a client may claim that the provider complete the agreement by moving the event to another part of the country not affected by the virus. Simply because the photographer experienced additional expenses would not be grounds for a successful defense.
With all of this said, providers should make reasonable efforts to keep their clients happy, regardless of legal issues. Discounts, rescheduling, or when possible even refunds should be considered since word of mouth from an unhappy customer can have a significant impact on the future of any business